Thousands of supporters of the Houthis, a predominantly Shia group that has repeatedly fought the Yemeni government, were travelling to the Al Ghadeer festival when the attack took place.

'Simmering tensions'

Hashem Ahelbarra, Al Jazeera's Yemen correspondent, said that "[the attack] comes amid simmering tensions in north Yemen between Houthi rebels and the authorities.".

The Houthis are members of the Zaidi sect of Shia Islam and follow the teachings of Bader Al-Deen Al-Houthi and his son, Hussein, the first leader of uprising who was killed in 2004.

The government and the Houthis have been observing a fragile ceasefire since February 2010, but the office of the UN High Commissioner for Refugees (UNHCR) warned on Tuesday that there had been an "alarming escalation" in fighting in the region, despite the nine-month-old truce.

A statement from the Houthis blamed US and Israeli involvement in the country for the attack.

"This criminal aggression is aimed at creating ethnic and sectarian division," a statement from the Houthis said.

"We demand all Yemeni society with its different political and social spectrum to denounce this crime which targets the Muslim Yemeni people."

'Al-Qaeda tactics'

But some sources have suggested that Al-Qaeda in the Arabian Peninsula could be behind the attack as the "tactics are similar to al-Qaeda tactics in Iraq and Afghanistan," Al Jazeera's Ahelbarra said.

If al-Qaeda involvement is confirmed, it would be the first reported al-Qaeda attack on Yemeni Shias. The Sunni Muslim-led network, known for large-scale suicide bombings, regularly attacks Shias in Iraq.

The attack comes two months after Al-Qaeda in the Arabian Peninsula accused the Houthis of capturing two of its members and handing them over to the security chief of Saada province.

However, attacks by the group, formed after the Yemeni and Saudi Arabian wings of Al-Qaeda merged in 2009, have previously been largely confined to the capital, Sanaa, and to the mainly Sunni south and east of Yemen.

Yemen has been at the forefront of the security concerns of the US and its allies after two US-bound parcel bombs claimed by al-Qaeda's Yemen-based operation were intercepted in Britain and Dubai.

Around 30,000 Yemeni troops are currently deployed in the turbulent south, often a site of bloody clashes between separatist armed groups and the state, in order to maintain security as it hosts a regional soccer tournament, the Gulf Cup.